China has long been a bulwark of the rule of cryptocurrency mining because of the excess of power in the country.
Some of the largest mining groups in the world, including such Antpool possible to cancel, in practice, BW extraction and BTC.com there are large mining companies in the country.
Mining is the Foundation of cryptocurrency, because the computers necessary to verify transactions stored on the Blockchain by solving cryptographic algorithms. As cryptocurrencies continue to grow in popularity around the world, the demand on the network grows.
This means that countries where energy is cheapest, are the most attractive for miners, as the process is hungry, to put it mildly.
China reduced its energy production last year due to an excess in their energy system, as this graph tradingeconomics.com shows, taking data from the National Bureau of statistics of China.
Electricity Production In China
This surplus has led to cheaper energy costs for consumers in China, which is a boon for mining operators in the country. However, China had previously threatened to stop the supply of cheap miners that are based in close proximity to hydroelectric power plants in the country.
According to Bloomberg, people's Bank of China (PBOC) intends to force local regulators to monitor and even limit the use of power miners in some regions of China.
The source said that the people's Bank of China told about the plans at a closed meeting on Wednesday, Jan. 3, as the country plans to transfer the excess energy in the country's regions, which have higher electricity demand.
While the country has an excess of energy that has resulted in a reduction of renewable energy used solar, hydro and wind sources, the country is firmly set on the treatment of cryptocurrencies in General.
The ban on ICO and cryptocurrency exchange last year made for tough conditions for the virtual currency in the country.
However, mining operations are continuing, but if these rules will come into effect, operators may be faced with strict control from the point of view of energy use.
As reported by Cointelegraph in December 2017, the joint use of energy in the global mining industry is more than many African countries, stressing the energy requirements of production processes.